Bhola gas lies unused, reserves could be 1,432b cubic feet

Gas production in the country has been declining every year. Even with the import of liquefied natural gas (LNG) at exorbitant cost, the demand is not being fully met. Industrial plants are not receiving gas as needed, and new investments are stalled. Yet, the gas in the southern island district of Bhola remains unused due to neglect. Even after two and a half decades, the government has not been able to formulate an effective plan for its utilisation.

According to sources at Bangladesh Oil, Gas & Mineral Corporation (Petrobangla), there is no arrangement to transport the gas produced in Bhola outside the district. Even within the district, gas usage has not been ensured according to production capacity. Although the Shahbazpur gas field has a production capacity of 150 million cubic feet per day, only a maximum of 75.5 million cubic feet is being utilised. Production has not yet started from two other gas fields.

In Borhanuddin upazila of Bhola, the Shahbazpur gas field was discovered in 1995 by Bangladesh Petroleum Exploration and Production Company (BAPEX). Gas production from Shahbazpur began in 2009. The same company discovered Bhola’s second gas field, Bhola North, in 2018, and the Ilisha gas field in 2023. Production from these two fields has not yet started.

Sources in Petrobangla say, the three gas fields in Bhola are estimated to hold a total of 1,432 billion cubic feet (BCF) of gas. So far, less than 200 BCF of gas has been produced in Bhola. However, reserves could increase with the drilling of new wells.

Daily gas demand is 38 billion cubic feet, while supply ranges from 27 to 28 billion cubic feet. Of this, 17 billion cubic feet is produced domestically. Even in 2017, the highest domestic production was 27 billion cubic feet per day. Since then, gas production has been declining continuously. To meet the shortfall, the government began importing LNG in 2018 at exorbitant prices.

After the discovery of the gas fields in the 1990s, the multinational company Unocal proposed transporting Bhola’s gas outside the district. They suggested laying a 120-kilometer pipeline and also proposed using the gas to set up power plants in Bhola, Barishal, and Khulna. The government at the time did not proceed, believing it would not be profitable. Even after all these years, the feasibility study in this regard has not yet been completed.

During the previous government, Petrobangla held discussions with the US company Accelerate Energy about building a pipeline to transport Bhola’s gas outside the district. The pipeline was planned to run from Bhola through Barishal to Khulna, with another line connecting Barishal to Dhaka via the Padma Bridge. Gas Transmission Company Limited (GTCL) conducted a feasibility study to bring Bhola’s gas as far as Barishal. During the interim government, the plan was revised, and a feasibility study is now underway for a direct pipeline from Barishal to Dhaka. The report is expected in December.

Additionally, the Ministry of Energy is considering converting Bhola’s gas into liquefied natural gas (LNG) for export. Several companies have shown interest. Once the pipeline feasibility study is complete, the government will decide on the most profitable option.

Petrobangla Chairman Md. Rezanur Rahman told Prothom Alo that Bhola’s gas is being considered carefully. It could be supplied to industries by filling large CNG cylinders and transporting them to Meghnaghat. The LNG option is also under consideration. Once the pipeline feasibility report is received, the next steps will be determined.

Gas production in Bhola is carried out by BAPEX, which supplies it to consumers through Sundarban Gas Distribution Company. According to BAPEX, after production, the gas is processed and supplied through pipelines.

Since the beginning, one 70-million-cubic-feet-per-day processing unit has been operating at Shahbazpur. Later, a temporary 20-million-cubic-feet unit was added, and two years ago, another 60-million-cubic-feet processing unit was installed. Despite this, production capacity remains underutilised. On Wednesday, the four wells produced 71 million cubic feet of gas, but the consumer-level distributor, Sundarban Gas Company, cannot fully take it.

Sundarban Gas Company says that gas is currently supplied to three power plants in Bhola, two captive power units (industrial self-generation), industrial factories, and 2,500 households. There are no new consumers, and no new industrial plants have been set up in Bhola. As a result, demand has not increased for several years. If the gas could be transported to Khulna, supply could be expanded.

After global LNG prices became unaffordable in 2022, the government began considering the use of Bhola’s gas. The government initiated a project to supply Bhola gas to industries in Dhaka by filling it into compressed natural gas (CNG) cylinders.

In the first phase, the CNG-sector company Intraco was given the contract for the supply of Bhola’s gas in CNG form, with a planned daily supply of 5 million cubic feet. Gas filling into cylinders from Bhola began in December 2023. The demand from various large industrial plants also started coming in regularly. However, the daily supply in cylinders remains very low. Even after nearly two years, only 800,000 to 900,000 cubic feet of gas is being delivered per day.

Industry insiders say that after the start of the gas crisis, many industrial plants were established in the Sylhet region solely because of the availability of gas. Bhola has ample land, gas, and electricity, as well as river transport access to Chattogram port. Yet, the government has not been able to attract significant investment here.

Geologist Badrul Imam told Prothom Alo that increasing investment in Bhola could have boosted gas demand. Even if a pipeline were built to transport the gas elsewhere, it would have alleviated much of the gas shortage. Bhola also has further gas potential. The previous government neglected this, and due to the need for a long-term plan, the current government may be unable to make quick decisions.